SOME CRITICAL ISSUES FACING THE DEVELOPMENT OF A BALANCED AND RESPONSIVE TRANSPORT SYSTEM TO THE YEAR 2000

In the basically competitive transport system of this century which has replaced the monopoly conditions of the railway era, each competing mode will perform most efficiently for society when transport markets are permitted to operate fully as competitive markets. In his testimony to the National Transportation Policy Study Commission, the author expresses his opposition to regulatory and other obstacles to price competition in transport for these tend to monopolize sectors of transport unnecessarily, to produce waste of resoruces, and to yield an unbalanced and unresponsive transport system. Only those very few industries that are true natural monopolies should continue to be subject to economic regulation. This excludes most transport industries as they are not true natural monopolies and have not been for several decades. With exceptions, they are many-firm, variable cost industries quite adaptable to competition, and their conversion by regulation into monopoly cartels has yielded only the disbenefits of monopoly without any of the advantages that come from regulated natural monopolies. The proper action for the Congress would be to deregulate comprehensively and to change transport promotional policy to deal even-handedly with all modes by requiring full user fees for public facilities and by subjecting public investment in transport ways, channels, and other facilities to investment and return tests as rigorous as are applied in private enterprise. Prof. Nelson offers abundant evidence of the mostly favourable results of deregulation in Great Britain, Canada and Australia whose institutions are very similar to those in the United States. /Author/

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  • Accession Number: 00177147
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Aug 19 1978 12:00AM